davis-lynch-inc-v-asgard-technologies-llc-mangrove-inc-talent ( 2015 )

Affirmed in Part, Reversed and Remanded in Part, and Majority and
Dissenting Opinions filed June 30, 2015.
In The
Fourteenth Court of Appeals
NO. 14-13-01112-CV
DAVIS-LYNCH, INC., Appellant
V.
ASGARD TECHNOLOGIES, LLC, MANGROVE, INC., TALENT FORCE,
INC., PHOENIX OFFSHORE SERVICES, L.L.C., TALENT FORCE
TECHNICAL, L.L.C., ASGARD RESOURCES, LLC, ASGARD
RESOURCES OF TEXAS, L.L.C., AND ARTHUR P. GRIDER, Appellees
On Appeal from the 334th District Court
Harris County, Texas
Trial Court Cause No. 2011-10745
MAJORITY OPINION
A staffing company placed a worker, later discovered to have a criminal
history of theft, in a receptionist position at Davis-Lynch, Inc. (DLI). DLI later
promoted the worker to head of accounting, and she embezzled millions of dollars.
In two issues, DLI challenges the trial court’s grant of summary judgment in favor
of appellees Asgard Technologies, LLC; Mangrove, Inc.; Talent Force, Inc.;
Phoenix Offshore Services, L.L.C.; Talent Force Technical, L.L.C.; Asgard
Resources, LLC; Asgard Resources of Texas, L.L.C.; and Arthur P. Grider
(collectively, Asgard). Concluding that DLI raised a genuine issue of material fact
regarding whether Asgard knew or should have known that, because of its acts of
retaining the employee from year to year without disclosing her criminal record to
DLI, the crime (or one like it) might occur, we reverse the trial court’s judgment as
to DLI’s negligent retention claim and remand that issue to the trial court for
proceedings consistent with our opinion. We affirm the trial court’s judgment in all
other respects.
Background
DLI is an oilfield manufacturing company. Pendragon Holding, Inc.,
Asgard’s predecessor, was a staffing company. In 1986, DLI and Pendragon
entered into a “Technical and Manufacturing Services Agreement.” The term of
the agreement was for one year, but could be extended by mutual consent.
Subsequent agreements were entered into between Asgard and DLI under
substantially similar terms, with Asgard assuming the responsibilities of
Pendragon. We refer to all relevant versions of these agreements as “the
Agreement.”
DLI outsourced its staffing and certain aspects of its management needs.
Asgard or its predecessors provided personnel to DLI “to cover management,
liaison, administrative, technical, maintenance, housekeeping, and clerical
requirements.” As set forth in the Agreement, Asgard had continuing
responsibilities to supervise personnel it placed at DLI and to supervise and
operate certain departments at DLI. The personnel placed at DLI by Asgard
continued to be Asgard employees even though they worked at (and under the
2
direction of) DLI. In addition, Asgard provided a program manager “responsible
for ensuring that operational, technical, and administrative . . . requirements are
satisfactorily performed.” The program manager supervised all personnel placed
by Asgard at DLI “in the performance of [Agreement] requirements.” Although
DLI directly employed its upper management, Asgard was also to provide certain
human resources functions.
Pendragon placed Nancy Moreno at DLI as a receptionist.1 In accordance
with the staffing arrangement described above, Moreno, at all relevant times, was
an employee of Asgard or one of its predecessors. Two years later, DLI promoted
Moreno to accounting clerk. Moreno was supervised by Thurman Northam.
Northam was injured in a car accident and could not return to work. DLI’s
president, Carl Davis, and vice president, Frank Cole, promoted Moreno to head of
accounting. Moreno hired several personnel to work in the accounting department,
including close relatives. She had access to financial records; was responsible for
accounts payable, accounts receivable, preparation of checks, assembling of
invoices for approval by Davis; and had access to company credit cards.
Approximately eight years after Moreno’s promotion to head of accounting,
DLI discovered that Moreno had arranged for a DLI copy machine to be delivered
to her son’s place of business. DLI terminated Moreno’s employment and then
discovered that Moreno had embezzled over $15 million from DLI while she was
working in the accounting department. DLI also learned that Moreno had been
placed on deferred adjudication in 1995 for misdemeanor theft and convicted of
another misdemeanor theft in 1999.
1
Bill Kelley, DLI’s manager of operations, testified that Moreno was originally placed in
DLI’s international department as an administrative assistant but then transferred to reception. It
is unclear from the record whether Asgard or DLI transferred her. Because both parties refer to
Moreno’s initial placement as a receptionist and because it does not alter our analysis, we also
refer to her job as receptionist.
3
DLI sued Asgard, bringing claims for negligence, breach of fiduciary duty,
and breach of contract and seeking damages of $15 million. Additional theories of
liability included respondeat superior and the individual liability of appellee Arthur
P. Grider.
Asgard filed separate traditional and no-evidence motions for summary
judgment on similar grounds, contending that Asgard was not negligent in hiring or
retaining Moreno because it had no duty to perform criminal background checks
under the Agreement or Texas common law, Moreno’s actions were not
foreseeable, Asgard was not negligent in supervising Moreno, Asgard’s actions
were not the proximate cause of DLI’s damages, there was no breach of contract,
Asgard did not breach any fiduciary duty to DLI, and Grider was not individually
liable for any alleged wrongdoing of the staffing companies.2 Asgard also argued
the affirmative defenses of quasi-estoppel, waiver, limitations, and laches
precluded its liability.
DLI responded and moved to strike Grider’s affidavit, which was part of
Asgard’s summary judgment evidence.3 The trial court denied the motion to strike,
granted the traditional motion for summary judgment, and denied the no-evidence
motion.4 Asgard subsequently filed a combined traditional and no-evidence motion
2
DLI argues that other employees also were involved in the embezzlement scheme. All
alleged embezzlers who were employees of Asgard sometimes are referred to herein as
“Moreno.”
3
On appeal, DLI argues, without citing any authority, that the trial court erred in denying
DLI’s motion to strike Grider’s affidavit because the affidavit was not based on personal
knowledge, was based on hearsay, and contained legal conclusions. DLI reurges on appeal its
motion to strike, but neither objected below nor objects on appeal to Grider’s authentication of
documents attached to his affidavit. To the extent that DLI has properly raised an appellate issue
complaining of the trial court’s denial of the motion to strike, we do not rely on the portions of
the Grider affidavit to which DLI objected in analyzing whether the trial court erred in granting
the motion for summary judgment. Thus, we need not reach the issue.
4
DLI filed a motion for reconsideration and request to enlarge the summary judgment
4
for summary judgment on DLI’s respondeat superior claim. The trial court granted
that motion without specifying the grounds.
Discussion
In two issues, DLI contends that the trial court erred in granting Asgard’s
motions for summary judgment. In its first issue, DLI complains that the trial court
erred in granting Asgard’s traditional motion and denying DLI’s motion for
reconsideration of the traditional motion because (1) Asgard owed it a fiduciary
duty to discover and disclose material facts concerning the criminal backgrounds
of Asgard employees placed at DLI; (2) Asgard breached the Agreement by failing
to perform background checks; (3) Asgard was negligent in hiring and retaining
Moreno; and (4) Grider is an alter ego of Asgard and thus personally liable. In its
second issue, DLI argues the trial court erred in granting Asgard’s no-evidence
motion on the respondeat superior claim because Asgard, as Moreno’s employer,
was liable for her actions.
We review de novo the trial court’s grant of summary judgment. See Mann
Frankfort Stein & Lipp Advisors, Inc. v. Fielding, 289 S.W.3d 844, 848 (Tex.
2009). In a traditional motion for summary judgment, the movant has the burden of
establishing that there is no genuine issue as to any material fact and that the
movant is entitled to judgment as a matter of law. Id. (citing Tex. R. Civ. P.
166a(c)). The nonmovant has no burden to respond to or present evidence
regarding the motion until the movant has carried its burden to conclusively
record. Nothing in the record indicates that the trial judge considered the supplemental evidence
(Exhibit 12), so we do not consider it on appeal. See Auten v. DJ Clark, Inc., 209 S.W.3d 695,
702 (Tex. App.—Houston [14th Dist.] 2006, no pet.) (“A trial court may accept summary
judgment evidence filed late, even after summary judgment, as long as the court affirmatively
indicates in the record that it accepted or considered the evidence.”); see also Benchmark Bank
v. Crowder, 919 S.W.2d 657, 663 (Tex. 1996) (recognizing that, unless the record affirmatively
indicates trial court permitted the late filing of summary judgment evidence, the appellate court
must presume the trial court did not consider the late-filed evidence).
5
establish the cause of action or defense on which its motion is based. State v.
$90,235, 390 S.W.3d 289, 292 (Tex. 2013). We consider all the evidence in the
light most favorable to the nonmovant, crediting evidence favorable to the
nonmovant if reasonable jurors could, and disregarding contrary evidence unless
reasonable jurors could not. See Fielding, 289 S.W.3d at 848.
The evidence raises a genuine issue of fact if reasonable and fair-minded
jurors could differ in their conclusions in light of all of the summary-judgment
evidence. Goodyear Tire & Rubber Co. v. Mayes, 236 S.W.3d 754, 755 (Tex.
2007). When, as in this case, the order granting summary judgment does not
specify the grounds upon which the trial court relied, we must affirm the summary
judgment if any of the independent summary-judgment grounds is meritorious.
$90,235, 390 S.W.3d at 292.
When a trial court grants a summary judgment on both no-evidence and
traditional grounds, we usually address the no-evidence grounds first. See Ford
Motor Co. v. Ridgway, 135 S.W.3d 598, 600 (Tex. 2004); PAS, Inc. v. Engel, 350
S.W.3d 602, 607 (Tex. App.—Houston [14th Dist.] 2011, no pet.). However, if we
conclude that we must affirm the trial court’s summary judgment ruling on
traditional grounds, we need not review the no-evidence grounds. See Wilkinson v.
USAA Fed. Sav. Bank Trust Servs., No. 14-13-00111-CV, 2014 WL 3002400, at *5
(Tex. App.—Houston [14th Dist.] Jul. 1, 2014, pet. denied) (mem. op.); see also
Tex. R. App. P. 47.1.
I. No Fiduciary Duty
DLI argues Asgard owed fiduciary duties to conduct criminal background
checks on Asgard employees placed at DLI, report the results to DLI, supervise
those Asgard employees, “assure trustworthy personnel were assigned to” DLI,
and indemnify DLI for its losses resulting from Moreno’s embezzlement.
6
According to DLI, these duties arose out of (1) an agency relationship between
Asgard and DLI created by the Agreement, and (2) Asgard’s employer-employee
relationship with Moreno.5
Breach of fiduciary duty requires proof of (1) a fiduciary relationship
between plaintiff and defendant, (2) breach of the fiduciary duty, and (3) damages
arising from the breach, either injury to the plaintiff or benefit to defendant. Lundy
v. Masson, 260 S.W.3d 482, 501 (Tex. App.—Houston [14th Dist.] 2008, pet.
denied). Due to its extraordinary nature, the law does not recognize a fiduciary
relationship lightly. See Willis v. Donnelly, 199 S.W.3d 262, 278 (Tex. 2006);
Hoggett v. Brown, 971 S.W.2d 472, 488 (Tex. App.—Houston [14th Dist.] 1997,
pet. denied). Whether such a duty exists depends on the circumstances. Hoggett,
971 S.W.2d at 488.
No Agency-Principal Relationship Giving Rise to Formal Fiduciary
Duties. DLI argues the Agreement created an agency-principal relationship
between DLI and Asgard. The Agreement reads as follows:
[Asgard] is hired as an independent contractor, and . . . nothing herein
is intended to nor shall create the relationship of employee, partner,
joint venture or associate, or any other relationship between DLI and
[Asgard], except that of principal and independent contractor.
(Emphasis added). Despite the plain language of the Agreement, in which the
parties described their relationship as that of “principal and independent
5
In its traditional motion for summary judgment, Asgard generally argued that it did not
breach any fiduciary duty and no fiduciary relationship existed between Asgard and DLI or
between Grider and DLI. In its response, DLI generally argued that (1) the relationship between
DLI and Asgard was one of trust and confidence, (2) a relationship of trust and confidence was
created between the parties based on contractual duties that would expose placed Asgard
employees to certain of DLI’s confidential information, and (3) the Agreement’s use of the word
“principal” created a principal/agent fiduciary relationship. In its motion for reconsideration, DLI
reiterated that a material fact exists as to whether the parties had a special relationship that rose
to the level of a fiduciary relationship.
7
contractor,” DLI asserts that the use of the word “principal” indicates a principal-
agent relationship exists between the two, which in turn created a fiduciary
relationship between them.
An agency relationship arises when the principal consents to the agent acting
on the principal’s behalf. See Walker Ins. Servs. v. Bottle Rock Power Corp., 108
S.W.3d 538, 549 (Tex. App.—Houston [14th Dist.] 2003, no pet.). Essential to the
principal-agent relationship is the principal’s right to control the acts of the alleged
agent. Id.; see also Hand v. Dean Witter Reynolds, Inc., 889 S.W.2d 483, 493 (Tex.
App.—Houston [14th Dist.] 1994, writ denied) (acknowledging that to be an agent
the principal must control the agent’s actions and manifest consent to the agent
acting on the principal’s behalf). The principal-agent relationship may be created
through actual or apparent authority. See CNOOC Se. Asia Ltd. v. Paladin Res.
(SUNDA) Ltd., 222 S.W.3d 889, 899 (Tex. App.—Houston [14th Dist.] 2007, pet.
denied). Agency is the type of special relationship that gives rise to a fiduciary
duty. See Johnson v. Brewer & Pritchard, P.C., 73 S.W.3d 193, 200 (Tex. 2002).
Here, the Agreement required Asgard, an independent contractor, to place
Asgard employees in DLI facilities. We look to the substance of the Agreement in
determining the exact nature of the relationship. See Nat’l Plan Adm’rs, Inc. v.
Nat’l Health Ins. Co., 235 S.W.3d 695, 702-03 (Tex. 2007). Despite using the
word principal to describe DLI, Asgard is defined clearly in the Agreement as an
“independent contractor,” not an agent. See id. at 703 (declining to impose general
fiduciary duty when agreement provided for “independent contractor” status).
Executing the Agreement was an arms’ length business transaction between two
sophisticated parties. See id. The parties themselves defined the parameters of their
respective roles, and if they had intended to create a principal-agent relationship,
they could have done so expressly. See id. We decline to impose a general
8
fiduciary duty on Asgard in light of the plain language of the Agreement.6 See id.
No Informal Fiduciary Relationship Created. DLI also argues that Asgard
owed DLI a fiduciary duty to provide it with trustworthy employees, presumably
because DLI and Asgard had a relationship of trust and confidence.7 An informal
fiduciary duty may arise from certain relationships of trust and confidence. Meyer
v. Cathey, 167 S.W.3d 327, 330-31 (Tex. 2005). However, “[i]t is well settled that
not every relationship involving a high degree of trust and confidence rises to the
stature of a fiduciary relationship.” Id. at 330 (citation omitted).
Informal fiduciary duties are not owed in business transactions unless the
special relationship of trust and confidence existed prior to, and apart from, the
transaction at issue in the case. Id. at 331. As the supreme court has held, “[M]ere
subjective trust does not . . . transform arm’s-length dealing into a fiduciary
relationship.” Ins. Co. of N. Am. v. Morris, 981 S.W.2d 667, 674 (Tex. 1998)
(quoting Schlumberger Tech. Corp. v. Swanson, 959 S.W.2d 171, 177 (Tex.
1997)).
We conclude that no special relationship giving rise to a fiduciary duty was
created under the circumstances of this case. We reached the same conclusion in
Dodson v. Kung, 717 S.W.2d 385 (Tex. App.—Houston [14th Dist.] 1986, writ
ref’d n.r.e.). Dodson and Kung met when Dodson was an employee at Kung’s golf
club, and the two developed a mentor-mentee relationship. Id. at 387. Some years
later, Dodson went to work for Kung’s company, and when a dispute arose,
6
DLI also argues that Asgard’s access to confidential information belonging to DLI
created a principal-agent relationship. DLI does not elaborate on how access to confidential
information, standing alone, could create such a relationship. Asgard contractually agreed to
keep such information confidential. We decline to impose an additional fiduciary duty on Asgard
based on its access to DLI’s information.
7
DLI argued below that it and Asgard had a relationship of trust and confidence.
9
Dodson sued, claiming a breach of an informal fiduciary duty. Id. The trial court
rendered summary judgment against Dodson on that issue, and we affirmed. Id.
While acknowledging that the relationship was one of business and friendship and
that Kung “was in a superior position because of his wealth and business
experience,” we observed that Dodson “was a grown man with considerable
business sense.” Id. at 389. Most importantly, there was “no evidence that these
men were not dealing at arm[’]s length and on equal terms.” Id. Accordingly, we
held that no fact issue had been raised as to breach of a fiduciary duty. Id.
Here, DLI had contracted with Asgard and its predecessors to obtain staffing
for more than a decade. As in Dodson, there is no evidence that these parties were
operating on any basis other than an arm’s length relationship and on equal terms.
See id. There are, therefore, no genuine issues of material fact as to the creation of
an informal fiduciary relationship or, as a result, breach of fiduciary duty.
We conclude that Asgard conclusively established it owed no fiduciary
duties to DLI, either formal or informal.
II. No Breach of Contract
As an initial matter, we must decide whether—as DLI contends—Asgard’s
traditional motion for summary judgment was too narrow to encompass DLI’s
breach of contract claim, as amended. DLI amended its petition after Asgard filed
its motion. The amendment included DLI’s claims that Asgard (1) failed to
investigate employees; (2) placed employees at DLI with criminal backgrounds;
(3) failed to disclose such oversights; and (4) failed to indemnify DLI for the losses
Moreno caused.
We conclude that these amendments were encompassed by Asgard’s motion.
DLI’s “failure to investigate” allegation is a restatement of its “failure to perform
background check” claim, which was addressed fully in Asgard’s motion. The
10
same is true with respect to DLI’s contention regarding indemnity. As expressly set
forth in the indemnity agreement, Asgard’s indemnity obligation arises only to the
extent of Asgard’s negligence, which argument was raised and developed.8 See
ConocoPhillips Co. v. Noble Energy, Inc., No. 14-13-00884-CV, 2015 WL
1456444, at *7 (Tex. App.—Houston [14th Dist.] Mar. 26, 2015, no. pet. h.)
(acknowledging courts interpret contracts in light of parties’ intentions as
expressed in the instrument and construe indemnity agreements under normal rules
of contract construction). Finally, DLI’s “failure to disclose” claim was
encompassed in the portion of Asgard’s motion addressing whether Asgard owed a
duty to conduct criminal background checks. Accordingly, the trial court did not
grant more relief than Asgard requested. See Wortham v. Dow Chem. Co., 179
S.W.3d 189, 202 (Tex. App.—Houston [14th Dist.] 2005, no pet.) (concluding
motion was broad and directed to evidence of duty owed or breached, so that later-
filed claims were addressed) (citing Lampasas v. Spring Ctr., Inc., 988 S.W.2d
428, 436-37 (Tex. App.—Houston [14th Dist.] 1999, no pet.) (holding when
amended petition merely reiterated essential elements in different form, the motion
applied to the changed pleading)).
DLI argues that the Agreement required Asgard to perform background
checks and that Asgard breached that contractual duty. The construction of an
unambiguous contract presents a question of law that we review de novo.9 Tawes v.
8
The indemnity provision reads as follows:
[Asgard] agrees to indemnify, hold harmless and defend DLI . . . from all
claims . . . arising out of or relating from [sic] employees of [Asgard] or
[Asgard’s] fraud, negligence or malfeasance and which occur during [Asgard’s]
performance under this contract. [Asgard] will only indemnify DLI to the extent
of [Asgard’s] negligence.
9
Neither party argues that the Agreement is ambiguous. However, they have conflicting
views regarding whether the Agreement required Asgard to perform background checks on the
employees it placed at DLI.
11
Barnes, 340 S.W.3d 419, 425 (Tex. 2011); ConocoPhillips, 2015 WL 1456444, at
*7. Our primary concern in interpreting a contract is to ascertain and give effect to
the intentions of the parties as expressed in the instrument. J.M. Davidson, Inc. v.
Webster, 128 S.W.3d 223, 229 (Tex. 2003). We therefore give terms their plain
and ordinary meaning unless the contract indicates that the parties intended a
different meaning. Dynegy Midstream Servs., Ltd. P’ship v. Apache Corp., 294
S.W.3d 164, 168 (Tex. 2009). We examine and consider the entire writing in an
effort to harmonize and give effect to all provisions of the contract, so that none
will be rendered meaningless. J.M. Davidson, 128 S.W.3d at 229.
DLI argues the following requirements imposed on Asgard in the Agreement
created a duty for Asgard to perform background checks on its employees:
(1) “provid[ing] adequate staff to meet production quotas and other requirements
established by [DLI]”; (2) “provid[ing] the necessary personnel to cover
management, liaison, administrative, technical, maintenance, housekeeping, and
clerical requirements”; (3) providing logistic support; (4) maintaining accurate
records, abiding by DLI’s policies, maintaining confidentiality, complying with the
manufacturing license, and protecting patents; (5) providing a program manager
responsible for ensuring “that operational, technical, and administrative contract
requirements are satisfactorily performed” through supervision of personnel,
liaising with DLI, and managing and administering logistic support; and
(6) indemnifying DLI to the extent of Asgard’s negligence.10
The plain language of the Agreement does not require Asgard to perform
10
As set forth above, we construe indemnity agreements under normal rules of contract
construction. Gulf Ins. Co. v. Burns Motors, Inc., 22 S.W.3d 417, 423 (Tex. 2000);
ConocoPhillips, 2015 WL 1456444, at *7. DLI asserts that the “claim for indemnity based on a
breach of fiduciary duty arises from the ‘agent-principal’ relationship that was formed by the
[Agreement].” As we have held there is no agent-principal relationship, DLI’s argument
regarding the indemnity agreement is without merit.
12
background checks. The Agreement was negotiated at arm’s length between
sophisticated parties. See FPL Energy, LLC v. TXU Portfolio Mgmt. Co., 426
S.W.3d 59, 67 (Tex. 2014) (“[S]ophisticated parties have broad latitude in defining
the terms of their business relationship.”). If the parties had envisioned a
background check requirement, they easily could have included it in the plain
language of the Agreement. See id. (“We must construe contracts by the language
contained in the document, with a mind to Texas’s strong public policy favoring
preservation of the freedom to contract.”). They did not do so here. We decline to
read such a provision into the Agreement. See id. at 67-68 (noting parties strike the
deal they choose to strike and bind themselves in the manner they choose and
concluding parties’ omission of reference to energy in liquidated damages
provision of contract was critical) (citing Tenneco Inc. v. Enter. Prods. Co., 925
S.W.2d 640, 646 (Tex. 1996) (“We have long held that courts will not rewrite
agreements to insert provisions parties could have included.”)). Asgard has
conclusively established that under the unambiguous terms of the Agreement, it
did not have a contractual duty to perform background checks.
III. Negligence
DLI argues that Asgard had duties to “hire, supervise, and retain competent
employees who [were] fit for the work they perform[ed]” and use ordinary care in
retaining Moreno and ensuring that the individuals Asgard placed at DLI were “not
thieves.” A negligence claim requires proof of circumstances giving rise to a legal
duty owed by the defendant to the plaintiff, a breach of that duty, and damages
proximately caused by that breach. Lee Lewis Constr., Inc. v. Harrison, 70 S.W.3d
778, 782 (Tex. 2001); Clark v. PFPP Ltd. P’ship, 455 S.W.3d 283, 287 (Tex.
App.—Dallas 2015, no. pet. h.). Negligent hiring, supervision, and retention claims
focus on the employer’s own negligence, not the negligence of the employee.
13
Clark, 455 S.W.3d at 287. An employer can be liable for negligence if its failure to
use due care in hiring, supervising, or retaining an employee creates an
unreasonable risk of harm to others. Id.
Although the supreme court has yet to set out what duty an employer has in
negligent hiring or supervision claims, it has indicated that to recover on these
theories, a plaintiff must show more than just negligent hiring practices.11 Wansey
v. Hole, 379 S.W.3d 246, 247 (Tex. 2012) (per curiam). The plaintiff also must
show it “suffer[ed] some damages from the foreseeable misconduct of an
employee” who was hired, supervised or retained pursuant to the defendant’s
negligent practices. Id.
Duty is a question of law for the court to decide based upon facts
surrounding the occurrence in question. Greater Houston Transp. Co. v. Phillips,
801 S.W.2d 523, 525 (Tex. 1990). In determining whether a duty exists, a court is
to consider several interrelated factors such as: (1) the risk involved;
(2) foreseeability of the risk; (3) likelihood of injury; and (4) the social utility of
the actor’s conduct and the magnitude of the burden on the defendant. See id. Of
all the factors considered, foreseeability of the risk is the foremost and dominant
consideration. Id. Foreseeability means that a person of ordinary intelligence
should have anticipated the dangers that his negligent act created for others.
Missouri Pac. R.R. Co. v. Am. Statesman, 552 S.W.2d 99, 103 (Tex. 1977).
As a general rule, “a person has no legal duty to protect another from the
criminal acts of a third person.” Timberwalk Apartments, Partners, Inc. v. Cain,
972 S.W.2d 749, 756 (Tex. 1998). This is because the criminal conduct of a third
party is a superseding cause that extinguishes any liability of the previous actor.
11
“We have not ruled definitively on the existence, elements, and scope of such torts and
related torts such as negligent training and hiring.” Waffle House, Inc. v. Williams, 313 S.W.3d
796, 804 n.27 (Tex. 2010).
14
See Phan Son Van v. Pena, 990 S.W.2d 751, 753 (Tex. 1999). However, if a
criminal’s conduct is a foreseeable result of the prior negligence of a party, the
criminal act may not excuse that party’s liability. See id. To impose liability on a
defendant for negligence in failing to prevent the criminal conduct of another, the
facts must show more than conduct that creates an opportunity to commit crime—
they must show both that the defendant committed negligent acts and that it knew
or should have known that, because of its acts, the crime (or one like it) might
occur. Barton v. Whataburger, 276 S.W.3d 456, 462 (Tex. App.—Houston [1st
Dist.] 2008, pet. denied).
Thus, for a legal duty to prevent the criminal conduct of another to arise, the
crime must have been reasonably foreseeable at the time the defendant engaged in
negligent conduct. Foreseeability exists if the actor, as a person of ordinary
intelligence, should have anticipated the dangers his negligent act creates for
others. D. Houston, Inc. v. Love, 92 S.W.3d 450, 454 (Tex. 2002). A danger is
foreseeable if its general character might reasonably be anticipated, if not its
precise manner. Travis v. City of Mesquite, 830 S.W.2d 94, 98 (Tex. 1992).
Determining whether a legal duty exists, including the foreseeability
element, is typically a legal question. Union Pac. R.R. Co. v. Williams, 85 S.W.3d
162, 166 (Tex. 2002); Salinas v. Briggs Ranches, 350 S.W.3d 218, 226 (Tex.
App.—San Antonio 2011, no pet.). However, if the essential facts about
foreseeability as an element of the defendant’s duty are disputed, the question is a
fact issue for the jury. Williams, 85 S.W.3d at 166. Evidence is disputed when it
“does not conclusively establish the pertinent facts or the reasonable inferences to
be drawn” from those facts. Id.
DLI cited a laundry list of allegedly negligent acts in its live petition. Certain
of these revolve around the failure of Asgard to perform a background check on
Moreno: negligent hiring, retention, investigation and screening, failure to discover
15
criminal background, failure to run background checks, failure to disclose
“suspicions,” and failure to disclose criminal background. Other allegedly
negligent acts include failure “to implement proper policies, procedures, and
protocols to . . . manage . . . and evaluate the Program Manager and other
employees put in positions of control and importance at [DLI]” and “failure to
properly manage and supervise.”
In its traditional motion for summary judgment, Asgard argued generally
that it was not foreseeable that Moreno, a receptionist, would become head of
DLI’s accounting department and engage in a high-dollar embezzlement scheme.
Asgard also argued that the Agreement did not require background checks and
none of the named defendants hired Moreno (rather, Moreno was hired by
Pendragon, a Grider company but not a named defendant). As to negligent
supervision, Asgard argued that the Agreement specified certain departments that
Asgard was to supervise and that the accounting department, where Moreno
worked when the embezzlement occurred, was not listed. With regard to negligent
hiring and retention, Asgard contended that (1) it did not hire Moreno or have a
duty to perform a background check on her; (2) DLI’s promotion of Moreno to
head of accounting and her embezzlement were not reasonably foreseeable to
Asgard; and (3) DLI did not perform background checks on its employees. Further,
Asgard asserted Moreno was not subject to Asgard’s control and DLI prevented
Asgard from supervising Moreno.
In its response, DLI argued that Asgard was required to conduct background
checks by custom and by common law and because of the special relationship
between the companies. DLI also argued that Asgard admitted that, after 2002, it
undertook to run background checks on all employees staffed at DLI and it learned
of Moreno’s theft conviction while she was employed by Asgard but did not notify
DLI.
16
No Duty to Manage and Supervise. Asgard was required under the
Agreement to supervise its employees and has conceded that it did not supervise
Moreno in her position as head of accounting. However, Asgard presented
uncontroverted evidence that it had no duty to supervise Moreno in the accounting
department because (1) the list of departments specified in the Agreement which
Asgard was required to supervise did not include the accounting department;
(2) accounting personnel were not under Asgard’s control; and (3) DLI prohibited
Asgard from supervising accounting personnel.
Asgard submitted DLI president Carl Davis’s deposition in support of the
motion. Davis testified that Frank Cole, DLI’s vice president, transferred Moreno
to the accounting department. At that time, Moreno reported to Thurman Northam.
When Northam left DLI, Davis and Cole promoted Moreno to Northam’s
position.12 Moreno then reported primarily to Cole.13 Davis, Cole, and others at
DLI gave Moreno her job assignments in the accounting department. Asgard did
not have access to DLI’s financial statements or reports, checks or supporting
documents prepared by Moreno for DLI’s accounting department, DLI’s
accounting system, or vendor invoices and supporting documentation handled by
the accounting department. Davis also testified that he did not know how Asgard
could supervise Moreno in light of Asgard’s lack of access to the accounting
records. Davis conceded that the only way for Asgard to supervise Moreno would
be if DLI complained about her job performance. DLI presented evidence that Tom
Grider, Asgard’s program manager, knew Moreno was doing some accounting
12
Before Northam left DLI, he and Moreno had been the only employees in the
accounting department. Northam did not have a job title. The department eventually grew, and
Moreno’s title became accounting department supervisor.
13
Davis was asked in his deposition, “When Ms. Moreno became the Accounting
Supervisor, who did she report to?” Davis responded, “Well, she was an Asgard employee, but
she probably answered a little bit more to Mr. Cole.”
17
work, but did not present evidence that Asgard was required to supervise that
work.
We conclude Asgard conclusively established it had no duty to manage and
supervise Moreno after she was transferred to the accounting department.
Negligent Hiring and Retention. As to the duty to perform a criminal
background check, both parties cite Wise v. Complete Staffing Servs., Inc., 56
S.W.3d 900 (Tex. App.—Texarkana 2001, no pet.). Wise, an employee of Mrs.
Baird’s Bakery, was attacked and severely injured by a temporary worker
employed by a staffing company and placed at Mrs. Baird’s as an unskilled
laborer. Id. at 901. Wise alleged that the staffing company was negligent and
grossly negligent in employing the temporary worker because it did not sufficiently
investigate his criminal background and that the staffing company had a “special
relationship” with the temporary worker and failed to adequately supervise his
activities and adequately check his credentials. Id. Wise also alleged that because
of its special relationship with the temporary worker, the staffing company had a
duty to discover and warn Mrs. Baird’s about the temporary worker’s criminal
background. Id. The staffing company moved for summary judgment, contending
that under the facts alleged by Wise, it had no general duty to seek or obtain
criminal records of its employees, no special circumstance existed that would
impose any heightened level of duty on it, and there was no evidence that it
assumed such a duty. Id. at 901-02.
The Wise court analyzed whether the temporary worker was placed in a
situation that foreseeably created a risk of harm to others because of his
employment duties. Id. at 903. The court noted that the case was unlike
Arrington’s Estate v. Fields, 578 S.W.2d 173, 178 (Tex. Civ. App.—Tyler 1979,
writ ref’d n.r.e.), in which an employer was found liable for negligently hiring
someone as a security guard when he had a long criminal record, as it was
18
foreseeable that a customer might be harmed by an armed employee performing a
hazardous job. Wise, 56 S.W.3d at 903. The Wise court concluded that its facts
were closer to Guidry v. National Freight, Inc., 944 S.W.2d 807, 811-12 (Tex.
App.—Austin 1997, no writ), in which a truck driver sexually assaulted a third
party and the court held such “bad acts” to be unforeseeable. Wise, 56 S.W.3d at
903. The employer’s duty in Guidry did not extend to investigating non-vehicular
criminal backgrounds. Wise, 56 S.W.3d at 903. The Wise court held that, similarly,
the temporary worker did not injure Wise as a result of incompetence or unfitness
for the job, but by an intervening criminal act and the staffing company had no
duty to check the criminal histories of its employees unless it was directly related
to the duties of the job at hand. Id.
Applying the Wise court’s analysis here, the embezzlement scheme was
clearly an intervening criminal act; however, it cannot lightly be said that
Moreno’s criminal history was not directly related to the duties of the job “at
hand,” which was head of accounting, when the “bad acts” occurred. What is
remarkable in this case is Moreno’s promotion from receptionist to head of
accounting. Had she remained in the position where she was placed by Asgard, she
would not have been in a situation that foreseeably created a risk of harm to others
because of her employment duties. See id.
We conclude that, considering the facts surrounding Asgard’s hiring and
placement of Moreno, Asgard had no duty to perform a background check. The
facts do not show that Asgard knew or should have known that, because of its acts
of hiring and placing Moreno without performing a background check, the crime
(or one like it) might occur.
Asgard, however, did not conclusively establish that the circumstances
foreclosed any duty to DLI regarding the retention of Moreno after Asgard became
19
aware of her criminal history of theft.14 Grider testified that he began running
criminal checks on new employees “sometime in 2002.” He also testified that he
became aware of Moreno’s criminal history during her employment with DLI;
Asgard, however, did not disclose this information. DLI argues that Asgard knew
about Moreno’s promotion to the accounting department based on Tom Grider’s
testimony that he knew Moreno “helped” Northam in accounting for a couple of
years. Asgard’s post-hiring but undisclosed knowledge of Moreno’s criminal theft
history, combined with Asgard’s post-hiring knowledge that Moreno had been
transferred to DLI’s accounting department, raises a fact question as to the
foreseeability of Moreno’s embezzlement in the absence of disclosure by Asgard to
DLI for purposes of a negligent retention claim. Accordingly, we conclude that the
trial court erred in granting summary judgment in Asgard’s favor as to DLI’s
negligent retention claim.
IV. Affirmative Defenses
As set forth above, we must affirm the trial court’s judgment if any of the
independent summary-judgment grounds is meritorious, notwithstanding our
conclusion as to DLI’s negligent retention claim. See $90,235, 390 S.W.3d at 292.
Accordingly, we shall address whether Asgard conclusively established every
element of any of its affirmative defenses. See Friendswood Dev. Co. v. McDade
& Co., 926 S.W.2d 280, 282 (Tex. 1996) (noting to prevail on a motion for
summary judgment, a defendant must conclusively establish each element of any
affirmative defense that was before the trial court). Asgard moved for summary
judgment on the affirmative defenses of quasi-estoppel, waiver, limitations, and
laches.
14
Moreno was hired initially in 1997. Her alleged co-conspirators were hired initially
between 1998 and 2002.
20
Quasi-estoppel and Waiver. Asgard argued in its traditional motion that
DLI is estopped from complaining and waived its right to complain that Asgard
was negligent in failing to perform background checks because DLI failed to
independently verify whether Asgard had been performing background checks.15 In
support of this argument, Asgard presented Davis’s deposition testimony in which
he stated he “took [Asgard] at [its] word” and did not independently verify that it
was performing background checks on employees.
Quasi-estoppel precludes a party from asserting, to another’s disadvantage, a
right inconsistent with a position previously taken. Lopez v. Munoz, Hockema &
Reed, L.L.P., 22 S.W.3d 857, 864 (Tex. 2000). The doctrine applies only when it
would be unconscionable to allow a person to maintain a position inconsistent with
one to which he acquiesced or from which he accepted a benefit. Id.
DLI’s reliance on Asgard’s purported reassurance that it was conducting
background checks is not the assertion of a right inconsistent with a position DLI
previously had taken. Davis’s uncontradicted testimony was that he believed
Asgard kept its “word.” Asgard presented no evidence of any inconsistencies in
DLI’s position.
Even if DLI were somehow asserting a right inconsistent with a position
previously taken, its reliance on Asgard’s representations would not have been
unconscionable. See Comiskey v. FH Partners, LLC, 373 S.W.3d 620, 638 (Tex.
App.—Houston [14th Dist.] 2012, pet. denied) (“[T]o constitute quasi-
estoppel . . . conduct had to have been unconscionable.”). Asgard presented no
evidence that DLI had any reason to independently verify that Asgard was
15
Asgard also asserted these affirmative defenses to DLI’s negligent supervision claim.
We need not address the negligent supervision claim because we hold that Asgard conclusively
established it had no duty to manage and supervise Moreno after she was transferred to the
accounting department.
21
conducting background checks or had any reason to suspect that Asgard was not
doing so. DLI’s actions under these circumstances were not unconscionable.
Waiver is the intentional relinquishment of a known right or intentional
conduct inconsistent with claiming that right. Tenneco, 925 S.W.2d at 643. Silence
or inaction, for so long a period as to show an intention to yield the known right,
may also establish waiver. Id. The elements of waiver are (1) an existing right,
benefit, or advantage held by a party; (2) the party’s actual knowledge of its
existence; and (3) the party’s actual intent to relinquish the right, or intentional
conduct inconsistent with the right. Ulico Cas. Co. v. Allied Pilots Ass’n, 262
S.W.3d 773, 778 (Tex. 2008); Clear Lake Ctr., L.P. v. Garden Ridge, L.P., 416
S.W.3d 527, 542 (Tex. App.—Houston [14th Dist.] 2013, no pet.).
Asgard argued that DLI took no action to ensure that Asgard performed
background checks “[f]or more than [10] years.” Asgard did not present evidence
to support this statement. It only presented evidence that Davis believed Asgard
was conducting background checks for an unspecified period of time. Moreover,
actual knowledge is required to establish waiver. Garden Ridge, 416 S.W.3d at
542. Asgard did not present evidence that DLI knew facts pertinent to the
purported negligence. See id. In fact, Davis testified he believed Asgard had been
conducting background checks on its employees. Asgard presented no evidence
that DLI knew Asgard was not conducting background checks. Similarly, Asgard
presented no evidence DLI intended to relinquish its purported right to be provided
with employees who had been subjected to background checks. Accordingly,
Asgard did not present conclusive evidence that DLI intentionally relinquished a
known right or engaged in conduct inconsistent with that right.
22
Limitations and Laches.16 Asgard also argued in its traditional motion that
DLI’s negligent retention claim was barred by the two-year statute of limitations
because DLI’s officer and attorney James Cox learned about Moreno’s criminal
history in 2006 and the lawsuit was not filed until 2011.17 See Tex. Civ. Prac. &
Rem. Code § 16.003(a) (requiring certain tort claims to be brought within two
years after cause of action accrues); see also JPMorgan Chase Bank, N.A. v. Prof’l
Pharmacy II, No. 02-11-00373-CV, 2014 WL 7473779, at *10 (Tex. App.—Fort
Worth Dec. 31, 2014, no pet.) (applying two-year statute of limitations from
section 16.003(a) to negligence claim).18 As the only evidence in support of this
argument, Asgard presented a letter purportedly written by Cox and sent to Arthur
Grider, indicating that Cox learned in 2006 that Moreno had a misdemeanor theft
charge in 1995 for which she received deferred adjudication. In response, DLI
presented evidence that Cox did not write the letter.19 This raises a fact question as
to whether Cox actually learned of Moreno’s criminal history in 2006.20 Thus,
Asgard did not conclusively establish that DLI’s negligent retention claim was
barred by limitations.
Asgard argued alternatively that it was entitled to summary judgment on its
laches defense because DLI unreasonably delayed in bringing its negligent
16
Asgard moved on these defenses as to all DLI’s claims. Our discussion is directed only
to the negligent retention claim, as we conclude Asgard conclusively established it was entitled
to summary judgment on DLI’s other claims.
17
We note that Cox also represented Asgard.
18
In cases governed by the discovery rule, a cause of action for negligence accrues when
the plaintiff discovers, or should have discovered through reasonable diligence, the injury and
that it was likely caused by the wrongful acts of another. J.M.K. 6, Inc. v. Gregg & Gregg, P.C.,
192 S.W.3d 189, 196 (Tex. App.—Houston [14th Dist.] 2006, no pet.).
19
Cox denied writing the letter in his deposition and in an affidavit presented in response
to Asgard’s traditional motion.
20
We thus need not address whether Cox’s knowledge could be imputed to DLI.
23
retention claim. To prevail on a laches defense, Asgard was required to prove DLI
unreasonably delayed in asserting its rights and Asgard made a good-faith change
in position to its detriment because of the delay. See Caldwell v. Barnes, 975
S.W.2d 535, 538 (Tex. 1998); see also Tex. Kidney, Inc. v. ASD Specialty
Healthcare, No. 14-13-01106-CV, 2014 WL 3002425, at *7 (Tex. App.—Houston
[14th Dist.] July 1, 2014, no pet.) (mem. op.). Asgard again relied only on the Cox
letter in support of this defense. Asgard did not present any evidence—or
argument—that it made a good-faith change in position to its detriment because of
any delay by DLI in bringing its negligent retention claim. Accordingly, Asgard
did not conclusively establish that it was entitled to summary judgment on its
laches defense.
We conclude that Asgard was not entitled to summary judgment on any of
its affirmative defenses.
V. Personal Liability Claims Against Arthur Grider
Asgard’s traditional motion also challenged DLI’s claims against Grider in
his personal capacity. DLI argues for the first time on appeal that Grider is
personally liable under an alter ego theory. Because DLI did not plead an alter ego
theory in the trial court, we do not reach this issue. DLI does not otherwise
challenge the trial court’s order granting summary judgment as to its claims against
Grider in his personal capacity.
We sustain DLI’s first issue as to the trial court’s grant of summary
judgment in favor of Asgard on DLI’s negligent retention claim. We overrule that
issue as to all of DLI’s other challenges to the trial court’s grant of traditional
summary judgment.
24
VI. Respondeat Superior
In its second issue, DLI challenges the trial court’s summary judgment in
favor of Asgard on DLI’s respondeat superior claim. As set forth above, Asgard
filed a combined no-evidence and traditional summary judgment motion on DLI’s
respondeat superior claim, and the trial court granted that motion without
specifying the grounds. Because we conclude we are required to affirm the
summary judgment ruling on traditional grounds, we need not address the no-
evidence grounds for summary judgment. See Wilkinson, 2014 WL 3002400, at *5.
Respondeat superior is the theory by which the employer is vicariously
liable for the torts of an employee acting within the scope of employment. Baptist
Mem’l Hosp. Sys. v. Sampson, 969 S.W.2d 945, 947 (Tex. 1998). “[A]n employer
is liable for its employee’s tort only when the tortious act falls within the scope of
the employee’s general authority in furtherance of the employer’s business and for
the accomplishment of the object for which the employee was hired.” Minyard
Food Stores, Inc. v. Goodman, 80 S.W.3d 573, 577 (Tex. 2002). In certain
instances, an employee of one employer may become a borrowed employee of
another and cease being an employee of the general employer. St. Joseph Hosp. v.
Wolff, 94 S.W.3d 513, 537 (Tex. 2002); see also Sparger v. Worley Hosp., Inc.,
547 S.W.2d 582, 583 (Tex. 1977). The essential inquiry under the borrowed
servant doctrine is which employer had the right of control of the details and
manner of the employee’s work. Alaniz v. Galena Park Indep. Sch. Dist., 833
S.W.2d 204, 206-07 (Tex. App.—Houston [14th Dist.] 1992, no writ) (analyzing
borrowed servant doctrine in whistleblower case). The employer that has the right
to direct and control the actions of the employee is vicariously liable for the
employee’s actions. See St. Joseph Hosp., 94 S.W.3d at 543.
In its summary judgment motion, Asgard asserted that the borrowed-servant
25
doctrine barred DLI’s respondeat superior claim because DLI had the exclusive
right to control Moreno’s work and Asgard did not control Moreno’s work. DLI
responded that the language of the contracts and facts relating to the right of
control over Moreno precluded summary judgment in Asgard’s favor.
Evidence in support of Asgard’s motion for summary judgment consisted of
the deposition testimony of Davis, Cole, and Bill Kelley, DLI’s manager of
operations. Asgard also offered the deposition testimony of Arthur and Tom
Grider. Regarding Moreno’s placement at DLI and Asgard’s involvement, Davis
testified:
 The receptionist position for which Moreno was placed had no written
job description, and in that position, she was not expected to handle
financial records, prepare or process checks, handle petty cash, or
issue credit cards.
 Approximately two years after Moreno began working as a
receptionist, Cole moved her to the accounting clerk position. Cole
obtained Davis’s approval to make this change.
 DLI promoted Moreno to the head of accounts payable and accounts
receivable, and Moreno reported primarily to Cole.
 DLI did not have the ability to fire an Asgard employee, but it could
notify Asgard that the employee was no longer needed.
 The Asgard on-site program manager—Tom Grider—did not have the
ability to make job assignments within DLI facilities. Although
Moreno was required to “report her performance” to the Asgard
supervisor on premises, Davis did not know “exactly” how she did so.
 Davis instructed Moreno to transfer funds from the various DLI bank
accounts, and he designated her as the “System Manager” of the
Chase bank account. Moreno did not seek or obtain approval from
Asgard to move funds from DLI’s operating account to the savings
account.
 Asgard was not responsible for approving DLI’s vendor’s invoices for
26
payment. Davis never asked Tom Grider to review Moreno’s accounts
payable or accounts receivables reports, nor did he see him do so.
 DLI issued credit cards to Moreno, and if anyone approved the
charges, it would have been Cole.
Cole testified that Davis was Moreno’s boss for accounting purposes and
that she reported to Cole for personnel issues. He was unequivocal in his testimony
that Moreno did not report to Asgard. Kelley also testified that Moreno reported to
Cole when she became head of accounting, and after 2008, Moreno reported to
Davis and Kelley. Moreno was trained for her accounting work by Northam,
Davis, and Cole. Kelley did not rely on Asgard to supervise the day-to-day work of
the accounting department. DLI maintained operational control over all of its
departments.
Tom Grider testified that Moreno reported to Cole, and Moreno did not
report to either Tom or Arthur Grider. DLI never complained about how and to
whom Moreno reported. Further, Tom Grider did not direct Moreno in her job
assignments, did not train Moreno for her duties in the DLI accounting department,
and was not involved in the decision to move Moreno from her receptionist
position to accounting. No one with Asgard had any involvement in Cole’s
decision to transfer Moreno to accounting.
Finally, Arthur Grider testified that Tom Grider did not provide technical
supervision to personnel staffed at DLI. Arthur confirmed that either Cole or DLI’s
plant manager supervised Moreno when she worked as a receptionist and that
personnel provided by Asgard in the accounting department at DLI did not report
to Asgard.
In response, DLI contends that in the Agreement, Asgard agreed to supervise
Moreno. As discussed above, however, Asgard had no involvement in Moreno’s
27
promotion to head of accounting, Moreno answered only to DLI employees after
her promotion, and Asgard had no authority to direct her job assignments. Asgard
thus demonstrated that DLI had the exclusive right to control Moreno’s work in the
accounting department, and Asgard did not do so.
DLI argues that emails between Tom Grider and Moreno show that Tom
supervised Moreno’s work. Even construed in the light most favorable to DLI, the
emails show only that Moreno was in the accounting department and that the two
exchanged emails regarding Asgard’s administrative matters.21 They are not
evidence that Asgard controlled Moreno’s day-to-day responsibilities in that
department.22
The uncontradicted evidence is that Asgard did not know of and was not
consulted about DLI’s decision to transfer Moreno to the accounting department
and then promote her to head of that department; Moreno did not answer to Asgard
after she was transferred; and Asgard did not direct or oversee her job assignments.
We conclude that Asgard conclusively established it had no right to control
Moreno’s day-to-day duties in the accounting department. See St. Joseph Hosp., 94
21
The emails involved weekly payroll deductions that needed to be corrected on an
Asgard invoice, healthcare provider forms to be completed by an Asgard employee, and another
Asgard employee’s paycheck.
22
DLI cites Lara v. Lile, 828 S.W.2d 536, 538 (Tex. App.—Corpus Christi 1992, writ
denied), for the proposition that in Texas, we presume an employer retains the right to control its
own employees. That case quotes the following language from the Restatement of Agency:
[I]n the absence of evidence to the contrary, there is an inference that the actor
remains in [her] general employment so long as, by the service rendered another,
[she] is performing the business entrusted to [her] by the general employer. There
is no inference that because the general employer has permitted a division of
control, he has surrendered it.
Id. (quoting Restatement (Second) of Agency § 227 cmt. b. (1958) (first emphasis added.)). The
Lara court further analyzed the case “[b]eginning with the inference that the general employer
retains control” to determine “what control [it] surrendered to the special employer.” Id. Here,
Asgard presented conclusive evidence that it did not control Moreno’s work in the accounting
department.
28
S.W.3d at 543.
We overrule DLI’s second issue.
Conclusion
We reverse the trial courts summary judgment as to DLI’s negligent
retention claim and remand that issue to the trial court for proceedings consistent
with our opinion. We affirm the trial court’s judgment in all other respects.
/s/ Martha Hill Jamison
Justice
Panel consists of Justices Boyce, Jamison, and Donovan (Justice Donovan
dissenting).
29